7 Methods to Effectively Engage Stakeholders

Stakeholder engagement is a key to project successFirst there was the principal stakeholder, who was also the director of the contracting state agency. Then three federal agencies (the major funding agencies). Then the state legislature, the state’s CIO, the head of Procurement, the contracting agency’s CIO, the heads of three sister agencies, a customer advocacy organization, the employees’ union …

I suspect I’m missing several stakeholders.

I was a senior manager within the agency’s PMO. We were charged with oversight responsibilities for the development and implementation of its mission-critical system. With this number of stakeholders – many of whom were very vocal and demanding – how much time do you think we spent administering the 7,500 project tasks? How much time do you think we spent managing the competing interests and expectations of the myriad of project stakeholders?

Fostering and managing stakeholder engagement on any sized project can become its own project within a project. It is a daunting challenge for a Project Manager to ensure appropriate stakeholder engagement on the project. It involves planning for unanticipated requests, varying degrees of engagement, political influence, and numerous other unpredictable challenges.

It requires the delicate balance of a tightrope walker to be able to manage project progress while fulfilling the varying expectations of stakeholders.

Project Managers have no formal authority over stakeholder engagement. Their ability to engage stakeholders, regardless how influential, depends on their capabilities and skill levels in the following seven areas:

  • Develop a stakeholder engagement plan.
    To best manage stakeholder engagement, the Project Manager must develop a stakeholder engagement plan. Rather than spend time discussing this plan here, please refer to my earlier detailed article, “9 Strategies to Plan Stakeholder Engagement”. It lays the groundwork for the points that follow.
  • Communicate regularly with stakeholders.
    In my own experience, I became acutely aware of the importance of engaging the stakeholders on my projects as I became a more proficient Project Manager. I found that frequent communication and continued consultation with them was essential to obtaining their engagement.

    Here is what is interesting from a project management perspective. Project Managers, almost exclusively, believe stakeholders know exactly what the project team is contracted to deliver. However, most Project Managers do not understand that the typical stakeholder is a big-picture thinker. He does not understand the many detailed tasks required to deliver a project.

    Why is this important? Because in making this assumption, Project Managers believe stakeholders will respond quickly and efficiently to whatever is asked of them. At the same time, stakeholders not wishing to display their lack of knowledge of the project, may resort to clever obfuscation or procedure when responding to project requests.

    And important communication does not happen.

    The Project Manager must provide information that is relevant to the stakeholders’ area of expertise. Once the information is communicated, the stakeholders will engage, knowing what is expected of them and why.

    Similarly, the Project Manager must be aware that stakeholders’ main priorities are their organizational responsibilities. This surpasses even the project’s importance to the organization. The Project Manager must understand these competing priorities and work with the stakeholders such that their project involvement is consequential yet not all-encompassing.

    Project Managers often make the mistake of requesting stakeholder engagement only when they feel it necessary to solve a problem outside their control. This is rarely effective in soliciting engagement. However, when Project Managers communicate the progress of the project to stakeholders, ask for their opinions and suggestions, and assign critical issues to them to resolve, they are much more likely to engage in the project.

    It is important that stakeholder contributions are publicly acknowledged (in the same way that any other project team member’s contributions are acknowledged). A simple ‘thank you’ goes a long way in maintaining essential communication with stakeholders.
    So does a special mention in a status report or an email (with a copy to her superior).

    I believe that early and frequent communication with stakeholders is one of the most important factors for project success. I also believe that it is one at which most Project Managers are inept. It’s not that Project Managers are poor communicators. It’s that they do not understand the nuances of stakeholder communication. The next article in this sequence will further elaborate on the importance of learning to communicate well with stakeholders.

    The next article in this sequence “Why IT Should Focus on Soft Skills – Part 2 will further elaborate on the importance of learning to communicate well with stakeholders.

  • Develop relationships with stakeholders.
    Stakeholders, especially influential stakeholders, can make or break a project. It is important to develop a relationship with each stakeholder such that their expectations can be met to the greatest degree possible. Projects rely on the stakeholders’ ability to remove roadblocks for the benefit of the project. Developing relationships with stakeholders involves developing trust. It is that trust that helps ensure that everyone is acting in the best interest of the project objectives. Problem-solving and decision-making are enabled. Confidence in the project team’s ability to get the job done is enhanced.

    In an earlier article, I discussed the importance of performing a stakeholder analysis during project initiation (see Stakeholder Analysis – A Practical Example from a Successful Project. It is compulsory that the Project Manager know each stakeholder and their project goals and objectives. Relationships begin with understanding each stakeholder’s motivation and interest in the project.

    As the project management plan is developed, the Project Manager should include the stakeholders in the plan. Why? Because the best way to foster their engagement is to directly assign ownership of significant activities that only they can perform. These should be limited to tasks that are outside the reach of the project team. The stakeholders quickly learn their importance to the project. The Project Manager is not giving away any control of the project to the stakeholders. However, giving ownership of important facets of the project to stakeholders helps secure their engagement.

  • Use stakeholders in risk response.
    In my communication with many Project Managers, I found that most believe that the sole benefit of having stakeholders on the project is for certain risk mitigation. While this is important – stakeholders are indeed critical to removing roadblocks that are beyond the project team control – communication and relationship are of paramount importance. These help establish urgency among the stakeholders to respond timely to risk events. Additionally, they can be highly effective in paving the way for smoother project progress.
  • Understand stakeholder behavior.
    As a byproduct of developing relationships with stakeholders, Project Manager become more knowledgeable of each stakeholder’s biases, interests, and objectives. They begin to better understand stakeholders’ behavior on the project. I discuss the various overarching behaviors of stakeholders and how to engage them in an earlier article, 5 Stakeholder Types and How to Engage Them.

    In addition to what is stated in that article, Project Managers should be aware of stakeholders that are risk-averse or have a loss aversion. Such characteristics hamper their ability to make good decisions on behalf of the project.

    Similarly, stakeholders with many demands on their time typically make hurried decisions. They have little regard for how their decisions might affect the project.

    I have also worked with stakeholders with unrealistic expectations, stakeholders that bend to political pressure, and stakeholders who are unwilling to admit their lack of knowledge in certain areas. Each of these types of situations must be recognized by the Project Manager as potentially detrimental. He can then support them in effectively completing their assignments.

  • Be prepared to compromise with stakeholders.
    Once the requirements are established and the scope is set, most Project Managers think that compromise comes only in the form of change orders. That is not always the case.

    Stakeholders, especially the stakeholders who are paying the bill, can put pressure on project executives. Such pressure runs downhill to the project team. For these situations, as well as for factors within the project’s control, the Project Manager must develop the ability to negotiate changes.

    Project Managers are often asked to agree to a stakeholder request to create goodwill. They may “horse-trade” lower priority functionality for a new stakeholder request. Or they may need to negotiate a change order that requires budget and schedule changes. Regardless of the request, Project Managers must develop strong negotiating skills to handle these compromises while protecting timelines and budgets.

    Additionally, Project Managers may need mediate between two or more stakeholders. The need to be able to accommodate conflicting requirements while protecting each stakeholder’s interests.

  • Anticipate stakeholder needs.
    This is perhaps one of the greatest shortcomings of most Project Managers. In my experience, Project Managers are single-mindedly dedicated to bringing the project in on time and within budget (this is good). However, in that single-mindedness they are oblivious to their stakeholders’ needs and wants (this is not good).

    Stakeholder engagement is critical. Indeed, the more communication between the project team and the stakeholders, and the stronger the relationship with the stakeholders. The stronger the relationship, the greater the ability for the Project Manager to anticipate the stakeholders’ needs.

    The ability to anticipate these needs demonstrates a higher level of perception and maturity on behalf of the Project Manager. This in turn results in significantly improved project delivery.

    Stakeholders develop greater trust in their Project Managers when their needs are anticipated and met in advance. They are thus assured that their goals, objectives, and concerns will be dealt with thoughtfully and professionally throughout the lifecycle of the project.

It is not surprising that Project Managers with well-honed people skills, negotiation/compromise proficiency, and communication ability when dealing with project stakeholders will have greater project success than Project Managers who do not possess these skills. This is the pinnacle of applying the people aspects of project management to successful project delivery.

Get Your Free Guidebook

Subscribe and receive your free guidebook,
5 Ways to Master the Art of Managing People, Projects and Profits.